AMWAL BROKERAGE L.L.C.

Transcription

1 AMWAL BROKERAGE L.L.C. Review report and interim financial information for the three month period ended 31 March 2012

2 Amwal Brokerage L.L.C. Review report and interim financial information for the three month period ended 31 March 2012 Contents Pages Report on Review of Interim Financial Information 1 Condensed Statement of financial position 2 Condensed Statement of comprehensive income (unaudited) 3 Condensed Statement of changes in equity (unaudited) 4 Condensed Statement of cash flows (unaudited) 5 Notes to the condensed financial statements (unaudited) 6-11

3 REPORT ON REVIEW OF INTERIM FINANCIAL INFORMATION The Board of Directors Amwal Brokerage L.L.C. Fujairah - United Arab Emirates Introduction We have reviewed the accompanying condensed statement of financial position of Amwal Brokerage L.L.C. - Fujairah, United Arab Emirates as at 31 March 2012 and the related condensed statements of comprehensive income, changes in equity and cash flows for the three month period then ended. Management is responsible for the preparation and presentation of this interim financial information in accordance with International Accounting Standard 34: Interim Financial Reporting. Our responsibility is to express a conclusion on this interim financial information based on our review. Scope of Review We conducted our review in accordance with International Standard on Review Engagements 2410, Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion. Conclusion Based on our review, nothing has come to our attention that causes us to believe that the accompanying interim financial information is not prepared, in all material respects, in accordance with International Accounting Standard 34: Interim Financial Reporting. 26 April 2012

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5 Amwal Brokerage L.L.C. 3 Condensed statement of comprehensive income (unaudited) Note Three month Three month period ended period ended 31 March 31 March Commission income 87,777 24,830 Interest and other income 6,139 92,825 General and administrative expenses 6 (628,863) (653,327) Loss for the period (534,947) (535,672) Other comprehensive income for the period - - Total comprehensive loss for the period (534,947) (535,672) The accompanying notes form an integral part of these condensed financial statements.

6 Amwal Brokerage L.L.C. 4 Condensed statement of changes in equity (unaudited) Statutory Accumulated Share capital reserve losses Net Balance at 31 December 2010 (Audited) 30,000, ,920 (3,575,359) 26,525,561 Loss for the three month period ended 31 March (535,672) (535,672) Other comprehensive income Total comprehensive loss for the period - - (535,672) (535,672) Balance at 31 March 2011 (Unaudited) 30,000, ,920 (4,111,031) 25,989,889 Balance at 31 December 2011 (Audited) 30,000, ,920 (5,705,184) 24,395,736 Loss for the three month period ended 31 March (534,947) (534,947) Other comprehensive income Total comprehensive loss for the period - - (534,947) (534,947) Balance at 31 March 2012 (Unaudited) 30,000, ,920 (6,240,131) 23,860,789 The accompanying notes form an integral part of these condensed financial statements.

7 Amwal Brokerage L.L.C. 5 Condensed statement of cash flows (unaudited) Cash flows from operating activities Three month Three month period ended period ended 31 March 31 March Loss for the period (534,947) (535,672) Adjustment for: Depreciation of property and equipment 3,335 27,560 Provision for employees end of service indemnity 4,069 2,355 Operating cash flows before changes in operating assets and liabilities (527,543) (505,757) Decrease/(increase) in accounts receivable 119,539 (681,716) Increase in accounts and other payables 1,135, ,357 Increase in due to related parties 547, ,026 Net cash generated from/(used in) operating activities 1,274,560 (438,090) Cash flows from financing activities Fujairah Investment Company L.L.C. current account 290 (2,332) Cash generated from/(used in) financing activities 290 (2,332) Net increase/ (decrease) in cash and equivalents 1,274,850 (440,422) Cash and equivalents at the beginning of the period 34,298,129 34,060,577 Cash and equivalents at the end of the period 35,572,979 33,620,155 The accompanying notes form an integral part of these condensed financial statements.

8 Amwal Brokerage L.L.C. 6 Notes to the condensed financial statements 1. General information Amwal Brokerage L.L.C. (the Company ), is a limited liability company established on 17 May 2005 in accordance with the provisions of UAE Federal Commercial Companies Law No. 8 of 1984, as amended, to undertake professional brokerage services in local securities and commodities markets in accordance with the rules and regulation of the Emirates Securities and Commodities Authority. The Company is licensed by the Emirates Securities and Commodities Authority to practice brokerage services under registration number 98. The Company s share capital of 30,000,000 is contributed by the Shareholders as follows: Amount Shareholding % M/s. Fujairah Investment Company L.L.C. 29,700, H.H. Sheikh Saleh Bin Mohammad Al Sharqi 300, ,000, ======== ====== Profits and losses are distributed between Shareholders based on their shareholding in the Company. The Company s registered address is P.O. Box 7220, Fujairah, United Arab Emirates. 2. Standards and Interpretations in issue but not yet effective and not early adopted The Company has not early applied the following new standards, amendments and interpretations that have been issued but not yet effective: New and revised IFRSs Amendments to IFRS 9 requires all recognised financial assets that are within the scope of IAS 39 Financial Instruments: Recognition and Measurement to be subsequently measured at amortised cost or fair value. IFRS 10 Consolidated Financial Statements* uses control as the single basis for consolidation, irrespective of the nature of the investee. IFRS 10 requires retrospective application subject to certain transitional provisions providing an alternative treatment in certain circumstances. Accordingly IAS 27 Separate Financial Statements* and IAS 28 Investments in Associates and Joint Ventures* have been amended for the issuance of IFRS 10. IFRS 11 Joint Arrangements* establishes two types of joint arrangements: Joint operations and joint ventures. The two types of joint arrangements are distinguished by the rights and obligations of those parties to the joint arrangement. Accordingly IAS 28 Investments in Associates and Joint Ventures has been amended for the issuance of IFRS 11. Effective for annual periods beginning on or after 1 January 2015

9 Amwal Brokerage L.L.C. 7 Notes to the condensed financial statements (continued) 2. Standards and Interpretations in issue but not yet effective and not early adopted (continued) Effective for annual periods New and revised IFRSs beginning on or after IFRS 12 Disclosure of Interests in Other Entities* combines the disclosure requirements for an entity s interests in subsidiaries, joint arrangements, associates and structured entities into one comprehensive disclosure Standard. IFRS 13 Fair Value Measurement issued in May 2011 establishes a single framework for measuring fair value and is applicable for both financial and non-financial items. Amendments to IAS 1 Presentation of Other Comprehensive Income. The amendments retain the option to present profit or loss and other comprehensive income in either a single statement or in two separate statements. However, items of other comprehensive income are required to be grouped into those that will and will not subsequently be reclassified to profit or loss with tax on items of other comprehensive income required to be allocated on the same basis. Amendments to IAS 12 Income Taxes provide an exception to the general principles of IAS 12 for investment property measured using the fair value model in IAS 40 Investment Property by the introduction of a rebuttable presumption that the carrying amount of the investment property will be recovered entirely through sale. Amendments to IAS 19 Employee Benefits eliminate the corridor approach and therefore require an entity to recognize changes in defined benefit plan obligations and plan assets when they occur. IFRIC 20 Stripping Costs in the Production Phase of a Surface Mine Amendments to IFRS 7 Financial Instruments: Disclosures enhancing disclosures about offsetting of financial assets and liabilities Amendments to IAS 32 Financial Instruments: Presentation relating to application guidance on the offsetting of financial assets and financial liabilities Amendments to IFRS 7 Financial Instruments: Disclosures relating to disclosures about the initial application of IFRS 9 1 July January January 2015 (or otherwise when IFRS 9 is first applied)

10 Amwal Brokerage L.L.C. 8 Notes to the condensed financial statements (continued) 2. Standards and Interpretations in issue but not yet effective and not early adopted (continued) * In May 2011, a package of five Standards on consolidation, joint arrangements, associates and disclosures was issued, including IFRS 10, IFRS 11, IFRS 12, IAS 27 (as revised in 2011) and IAS 28 (as revised in 2011). These five standards are effective for annual periods beginning on or after 1 January Earlier application is permitted provided that all of these five standards are applied early at the same time. Management anticipates that these amendments will be adopted in the Company s financial statements for the period beginning or as and when they are applicable and adoption of these standards and interpretations may have no material impact on the financial statements of the Company in the period of initial application. 3. Summary of significant accounting policies 3.1 Basis of preparation These condensed financial statements have been prepared in accordance with International Accounting Standard (IAS) No. 34, Interim Financial Reporting and also comply with the applicable requirements of the laws in the U.A.E. The condensed financial statements are presented in U.A.E. Dirhams () since that is the currency in which the majority of the Company s transactions are denominated. These condensed financial statements have been prepared on the historical cost basis, except for the revaluation of financial instruments. These condensed financial statements do not include all the information required for full annual financial statements and should be read in conjunction with the Company s audited annual financial statements as at and for the year ended 31 December In addition, results for the three month period ended 31 March 2012 are not necessarily indicative of the results that may be expected for the financial year ending 31 December The accounting policies, presentation and methods used in these condensed financial statements are consistent with those used in the audited financial statements for the year ended 31 December As required by the Securities and Commodities Authority ( SCA ) notification dated 12 October 2008, accounting policy relating to property and equipment has been disclosed in the condensed financial statements.

11 Amwal Brokerage L.L.C. 9 Notes to the condensed financial statements (continued) 3. Summary of significant accounting policies (continued) 3.2 Property and equipment Capital work in progress is stated at cost less any recognized impairment loss. Depreciation on these assets, on the same basis as other assets, commences when the assets are ready for their intended use. Other property and equipment are carried at cost less accumulated depreciation and any identified impairment loss. Subsequent costs are included in the asset s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. All other repairs and maintenance are charged to the statement of comprehensive income when incurred. Depreciation is charged so as to write off the cost of assets, other than capital work in progress, over their estimated useful lives, using the straight-line method. The estimated useful lives, residual values and depreciation method are reviewed at each year end, with the effect of any changes in estimate accounted for on a prospective basis. The gain or loss arising on the disposal or retirement of an item of property and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognized in profit or loss. Depreciation is provided on the straight-line method based on the anticipated useful lives, as follows: Years Office furniture and fixtures 3-4 Motor vehicles 3 Office equipment 4 4. Bank balances and cash 31 March 31 December (unaudited) (audited) Bank balances: Current accounts 5,572,007 4,297,396 Cash on hand ,572,979 4,298,129

12 Amwal Brokerage L.L.C. 10 Notes to the condensed financial statements (continued) 5. Related party transactions Amounts due to related parties were as follows: 31 March 31 December (unaudited) (audited) Fujairah National Group L.L.C. 1,930,269 1,713,120 Fujairah National Properties L.L.C. 1,644,834 1,314,834 Transactions: 3,575,103 3,027,954 During the period, the Company entered into the following transactions with related parties: Three month Three month period ended period ended 31 March 31 March (unaudited) (unaudited) Commission income 8,301 2,574 Rent expense 82,500 82,500 Transactions with related parties are entered into on terms agreed upon with management. 6. General and administrative expenses General and administrative expenses amounted to 628,863 (2011: 653,327) include the following major expenses: Three month Three month period ended period ended 31 March 31 March (unaudited) (unaudited) Salaries and benefits 187, ,519 Telephone and fax 136,138 87,229 Bank charges 52,075 52,100 Depreciation 3,335 27,560 Rent 82,500 82,500

13 Amwal Brokerage L.L.C. 11 Notes to the condensed financial statements (continued) 7. Commitments and contingent liabilities 31 March 31 December (unaudited) (audited) Bank guarantees 20,000,000 20,000,000 Labour guarantees 24,100 24,000 Bank guarantees are provided by a related party to meet the requirements of the Emirates Securities and Commodities Authority. 8. Approval of condensed financial statements The condensed financial statements were approved and authorised for issue on 26 April 2012.